M/S Echjay Forging Industries Pvt. Ltd. … vs Mr. Vasant Krishna Ghadge And Ors. on 26 March, 2026

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    Bombay High Court

    M/S Echjay Forging Industries Pvt. Ltd. … vs Mr. Vasant Krishna Ghadge And Ors. on 26 March, 2026

    Author: Amit Borkar

    Bench: Amit Borkar

    2026:BHC-AS:14382
                                                                                             wp10074-2016-J.doc
    
    
                                Sayali
    
    
                                           IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                                   CIVIL APPELLATE JURISDICTION
    
                                                      WRIT PETITION NO.10074 OF 2016
    
                                   1. Echjay Forging Industries Pvt Ltd
                                      (Formerly known as Echjay Forgings
                                      Pvt. Ltd) Kanjur Village Road, Kanjur
                                      (E) Mumbai:- 400 042
    
                  Digitally
                                   2. Deepakbhai M. Doshi
                  signed by
    
         ATUL
                  ATUL
                  GANESH
                                      M/s. Echjay Forging Industries Pvt Ltd
         GANESH   KULKARNI
         KULKARNI Date:
                  2026.03.26          (Formerly known as Echjay Forgings Pvt
                  12:14:18
                  +0530
                                      Ltd) Kanjur Village Road, Kanjur (E)
                                      Mumbai: 400 042.                       ... petitioners
                                                              V/s.
                                   1. Vasant Krishna Ghadge,
                                      C/o Krishna Vithoba Gurav, Gurav
                                      Chawl, New Amar Bharat Seva Mandal,
                                      Sainath Nagar Road, Behind KVK High
                                      School, Ghatkopar (W),
                                      Mumbai 400 086.
                                   2. Mr. Krishna Vithoba Gurav,
                                      Gurav Chawl, New Amar Bharat
                                      Seva Mandal, Sainath Nagar Road,
                                      Behind KVK High School,
                                      Ghatkopar (W), Mumbai 400 086.
                                   3. Mr. Anilkumar Nanda Naik
                                      C/o Krishna Vithoba Gurav,
                                      Gurav Chawl, New Amar Bharat Seva
                                      Mandal, Sainath Nagar Road, Behind
                                      KVK High School, Ghatkopar (W),
                                      Mumbai 400 086.
    
    
    
    
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          4. Mr. Sachin Gangaram Mahadik,
             C/o Krishna Vithoba Gurav,
             Gurav Chawl, New Amar Bharat Seva
             Mandal, Sainath Nagar Road,
             Behind KVK High School,
             Ghatkopar (W), Mumbai 400 086.                   ... Respondents
    
     Mr. Avinash Jalisatgi with Ms. Divya Wadekar and Mr.
     Mulanshu Vora, for petitioners.
     Mr. Shafi Kazi, Mr. T. V. Louis, Mr. Biju Joseph, & Mr.
     Vishal Sapre i/b KLT Law Associates, for respondents.
    
    
                              CORAM             : AMIT BORKAR, J.
    
                              RESERVED ON       : MARCH 13, 2026
    
                              PRONOUNCED ON : MARCH 26, 2026
    
     JUDGMENT:

    1. By the present writ petition filed under Articles 226 and 227
    of the Constitution of India, the petitioners call in question the
    legality and validity of the order dated 20 July 2016 passed by the
    Industrial Court, Mumbai in Complaint (ULP) No. 248 of 2013.
    The petitioners seek issuance of a writ of certiorari, or any other
    appropriate writ, order or direction, for calling for the record and
    proceedings of the said complaint and, upon examination thereof,
    for quashing and setting aside the impugned order.

    2. The facts giving rise to the present petition, in brief, are as
    follows. Petitioner No. 1 is a private limited company, formerly
    known as Echjay Forgings Pvt. Ltd., engaged in the business of
    manufacturing and machining steel and steel alloy forgings at its

    SPONSORED

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    factory situated at Kanjur Village Road, Kanjur (East), Mumbai.
    The respondents were employed in the said factory. The petitioners
    declared closure of the said factory and terminated the services of
    the four respondents for the reasons set out in the notice of closure
    dated 21 June 2013. Aggrieved thereby, the respondents filed
    Complaint (ULP) No. 248 of 2013 before the Industrial Court,
    Mumbai under Section 28 read with Items 9 and 1(c) of Schedule
    IV of the Maharashtra Recognition of Trade Unions and Prevention
    of Unfair Labour Practices Act, 1971
    . By its final judgment and
    order dated 20 July 2016, the Industrial Court held, inter alia, that
    the petitioners had engaged in unfair labour practices by effecting
    an illegal closure and issued consequential directions against the
    petitioners.

    3. It is the case of the petitioners that pursuant to a Scheme of
    Arrangement in the nature of a de-merger, sanctioned by this
    Court by order dated 05 December 2014 in Company Scheme
    Petition No. 432 of 2014 along with connected Company
    Summons for Direction No. 758 of 2013 and Company Scheme
    Petition No. 433 of 2014 along with Company Summons for
    Direction No. 759 of 2013, all assets and liabilities pertaining to
    the said factory stood transferred to petitioner No. 1. Petitioner
    No. 2 is stated to be a Director of petitioner No. 1. At the relevant
    time, the petitioners were engaged in manufacturing and
    machining of steel and steel alloy forgings, and in or about the
    year 2012, approximately 129 employees, including staff members,
    were employed at the said factory. The petitioners contend that
    owing to severe recessionary conditions prevailing globally and

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    rising inflation, the financial position of petitioner No. 1 became
    precarious. In these circumstances, a decision was taken to shift
    and relocate the manufacturing activities from the existing
    premises at Kanjur, Mumbai to Khalapur in District Raigad.
    Accordingly, a notice dated 10 February 2012 was displayed in the
    factory informing all employees of the proposed relocation. By the
    said notice, a Voluntary Retirement Scheme was also introduced
    for the employees.

    4. The said notice was challenged by the employees by filing
    Complaint (ULP) No. 142 of 2012 before the Industrial Court,
    Mumbai alleging unfair labour practices, along with an application
    for interim relief. By an interim order dated 23 August 2012, the
    learned Member of the Industrial Court directed the petitioners,
    inter alia, to provide work to the employees at the Mumbai factory.
    The petitioners challenged the said interim order by filing Writ
    Petition No. 8850 of 2012 before this Court. The learned Single
    Judge admitted the petition and granted a stay to the operation of
    the Industrial Court’s order dated 23 August 2012. The employees
    thereafter preferred Letters Patent Appeal No. 854 of 2012. The
    Division Bench allowed the appeal, set aside the order of the
    learned Single Judge, and remanded the matter for fresh
    consideration. During the pendency of the said proceedings, the
    workmen joined a trade union known as Akhil Bharatiya
    Asanghathit Shramik General Kamgar Union. After prolonged
    negotiations, an amicable settlement was arrived at between the
    petitioners and the workmen represented by the said union.
    Similarly, the staff members constituted a Staff Committee and

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    entered into a separate but similar settlement with the petitioners.
    Under both settlements, the workmen and staff members expressly
    stated that they were not willing to continue employment at the
    Khalapur unit and agreed to relinquish their rights to employment
    or re-employment. It was agreed that they would voluntarily resign
    from service, and in consideration thereof, the petitioners would
    pay monetary compensation and other benefits. It was further
    agreed that such resignations would take effect from 19 June
    2012. Except for the present four respondents, all remaining 125
    workmen and staff members accepted the terms of the settlement
    and executed the same. The petitioners paid all dues in accordance
    with the settlement to those who accepted it. The present
    respondents did not accept or sign the settlement. It is the case of
    the petitioners that all other employees had either resigned or
    were deemed to have resigned with effect from 19 June 2012.
    Those employees who had accepted the settlement filed a purshis
    dated 07 March 2013 before the Industrial Court in Complaint
    (ULP) No. 142 of 2012 seeking withdrawal of their names, which
    was allowed and their names were deleted from the proceedings.
    According to the petitioners, after 18 June 2013, only the present
    respondents continued in employment. In view of financial
    constraints and the alleged impossibility of continuing operations,
    the petitioners decided to permanently close the factory and issued
    a notice of closure. The services of the respondents were
    terminated by issuing individual termination letters on account of
    closure, and they were paid all statutory dues. It is further
    contended that the average number of employees during the

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    twelve months preceding the closure was less than 100, and
    therefore, the provisions of Chapter V-B of the Industrial Disputes
    Act, 1947
    were not attracted.

    5. The petitioners contend that since the services of all
    employees concerned in Complaint (ULP) No. 142 of 2012 had
    come to an end, the said complaint had become infructuous and
    was accordingly disposed of by the Industrial Court. The
    respondents did not challenge that order. Thereafter, on 29 July
    2013, the respondents filed Complaint (ULP) No. 248 of 2013
    before the Industrial Court, Mumbai under Section 28 read with
    Items 9 and 10 of Schedule IV of the ULP Act, challenging the
    closure and termination of their services. Interim reliefs were also
    sought. The respondents filed documents along with a list. The
    petitioners filed their written statement and supporting
    documents, including a list dated 30 July 2013. Upon an
    application made by the respondents seeking production of
    documents, the petitioners produced muster rolls for the relevant
    period and filed a purshis explaining their inability to produce
    certain other documents. Subsequently, original muster rolls and
    additional documents were also produced. Respondent Nos. 1 and
    2 entered the witness box, while the other respondents did not
    lead evidence. On behalf of the petitioners, one Mr. K. K.
    Chandrakant, an ex-Cashier, was examined as a witness. Both
    parties also filed written submissions in addition to oral
    arguments. Upon consideration of the material on record, the
    Industrial Court, by its judgment and order dated 20 July 2016,
    held that the closure effected by the petitioners was illegal and

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    amounted to an unfair labour practice under Items 9 and 10 of
    Schedule IV of the ULP Act. The Industrial Court further directed
    the petitioners to pay 50 percent of the wages to the respondents
    from 21 June 2013 till the date of their superannuation, calculated
    on the basis of their last drawn wages.

    6. Mr. Avinash Jalisatgi, learned counsel appearing on behalf of
    the petitioners, submitted that the respondents, by filing
    Complaint (ULP) No. 248 of 2013 before the Industrial Court, have
    challenged the action of the petitioners in declaring closure of the
    factory and the consequential termination of their services. It is
    contended on behalf of the respondents that such closure is illegal,
    mala fide and amounts to unfair labour practices under Items 9
    and 10 of Schedule IV of the Maharashtra Recognition of Trade
    Unions and Prevention of Unfair Labour Practices Act, 1971
    . The
    challenge to the closure is principally founded on two grounds,
    namely, that the closure was effected in violation of the provisions
    of the Industrial Disputes Act, 1947, and that prior permission of
    the State Government, as allegedly required, was not obtained.
    Learned counsel for the petitioners further submitted that the
    Industrial Court, by the impugned order, has allowed the
    complaint and, upon holding the closure to be illegal, has directed
    the petitioners to pay 50 percent of the monthly wages to the
    respondents till their respective dates of superannuation.
    According to him, the said order is contrary to law, unsustainable
    and liable to be quashed and set aside. He submitted, firstly, that
    the Industrial Court has erroneously held that the petitioners
    committed a breach of Section 33 of the Industrial Disputes Act,

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    1947. It is urged that for attracting Section 33, it must be
    established that a proceeding of the nature contemplated therein
    was pending before a Court or Tribunal, which was not the case
    here. The pendency of proceedings under the ULP Act or a writ
    petition would not attract Section 33. Reliance is placed on the
    decision in Uttam B. Abhang vs. Durwani Karmachari Sahakari
    Patsanstha Maryadit, Ahmednagar
    , 2015 LAB. I.C. 4132 . It is
    further submitted that there was no specific pleading in the
    complaint in respect of any alleged breach of Section 33. Secondly,
    it is contended that the finding of breach of Section 18 of the
    Industrial Disputes Act, which pertains to settlements, is also
    misconceived. Elaborating further, learned counsel submitted that
    settlements were entered into with 76 workmen and 49 staff
    members, aggregating to 125 employees. None of these employees
    have questioned the said settlements. All of them accepted the
    terms, tendered resignation and voluntarily ceased employment. It
    is submitted that the present four respondents, who did not accept
    the settlements, have no locus to challenge the same. It is further
    pointed out that these 125 employees filed affidavits before the
    Industrial Court and sought deletion of their names from
    Complaint (ULP) No. 142 of 2012, which was accordingly allowed.
    It is thus contended that the legality of the said settlements could
    not have been examined in the present proceedings arising out of
    Complaint (ULP) No. 248 of 2013.

    7. Learned counsel further submitted that the Industrial Court
    has erred in holding that the petitioners violated the provisions of
    Chapter V-B of the Industrial Disputes Act, particularly Section 25-

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    O. He submitted that as per Section 25-K, Chapter V-B applies only
    to industrial establishments employing 100 or more workmen on
    an average per working day during the preceding twelve calendar
    months. The Industrial Court has not recorded any finding that
    this threshold was satisfied. It is contended that the burden to
    prove that the number of workmen exceeded the statutory limit
    lies upon the respondents, which burden they have failed to
    discharge. Reliance is placed on Maharashtra General Kamgar
    Union vs. Indian Gum Industrial Ltd. It
    is further submitted that
    the petitioners produced muster rolls demonstrating that the
    average number of employees during the period from 21 June
    2012 to 21 June 2013 was approximately 85. It is also pointed out
    that Respondent No. 1, in his cross-examination, admitted that the
    statements regarding the number of employees in his affidavit
    were based on instructions of his advocate and that he was unable
    to substantiate the same. It is further submitted that the Industrial
    Court has incorrectly held that the petitioners retrenched 129
    employees. According to the petitioners, out of 129 employees,
    125 had voluntarily resigned and left service prior to the closure,
    and therefore, there was no question of their retrenchment. It is
    also contended that such a case was never pleaded by the
    respondents.

    8. Learned counsel for the petitioners further submitted that in
    proceedings under the ULP Act, where closure is under challenge,
    the Industrial Court cannot examine the motive of the employer in
    effecting closure. Reliance is placed on the decision in M/s. Indian
    Hume Pipe Co. Ltd. vs. Their Workmen
    . It is contended that

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    despite this settled position, the Industrial Court has erroneously
    gone into the question of motive and recorded a finding that the
    closure was effected with the intention of selling the factory land.
    It is further submitted that once the closure is complete and final,
    no relief could have been granted by the Industrial Court. It is
    pointed out that, as stated in the Additional Affidavit dated 24
    December 2025, the factory is no longer in existence. The
    petitioners have also placed on record details of the number of
    workmen and man-days for the relevant period to demonstrate
    that the average number of workmen per working day was 84.85,
    which is below the statutory threshold. In support of the above
    submissions, reliance is placed on the judgments in Maharashtra
    General Kamgar Union vs. Indian Gum Industrial Ltd.2000 II CLR

    509,, M/s. Indian Hume Pipe Co. Ltd. vs. Their WorkmenAIR 1968
    SC 1002.

    9. Per contra, Mr. Shafi Kazi, learned counsel appearing on
    behalf of the respondents, submitted that the alleged shifting of
    the factory to Khalapur was merely a pretext and a device adopted
    by the petitioners to circumvent statutory obligations. According to
    him, the real intention of the petitioners was to dispose of the
    factory premises at Kanjurmarg for development purposes, as is
    evident from the Additional Affidavit dated 24 December 2025. It
    is submitted that the land has been converted from industrial to
    residential use and has been developed by constructing multiple
    buildings comprising a large number of flats, most of which have
    already been sold and occupied. It is contended that third-party
    rights have been created, rendering the closure irreversible.

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    According to the respondents, such conduct amounts to a clear
    violation of the provisions of the Industrial Disputes Act, 1947 and
    demonstrates that the plea of financial difficulty was merely a
    facade. It is further alleged that the settlements were engineered in
    collusion with a so-called union and its office bearers, including
    one Ms. Nasreen Shinde, and that the entire process was vitiated
    by mala fides and lack of transparency. Learned counsel for the
    respondents submitted that the material on record clearly
    establishes that the closure was a mere camouflage adopted to
    evade statutory obligations. It is contended that the action of the
    management was taken in collusion with a union and in disregard
    of orders passed in pending proceedings before this Court as well
    as the Industrial Court. It is further submitted that the Industrial
    Court has rightly held that the petitioners indulged in unfair
    labour practices under Items 9 and 10 of Schedule IV of the MRTU
    and PULP Act
    . It is further submitted that the Industrial Court has
    recorded a finding that the retrenchment of employees was in
    contravention of Sections 18, 25-N and 25-O of the Industrial
    Disputes Act, 1947, and has accordingly granted relief of 50
    percent wages to the respondents from 21 June 2013 till their
    superannuation. Reliance is placed on the material forming part of
    the record of the writ petition. It is thus contended that the
    termination of services of the respondents under the guise of
    closure is illegal, mala fide and unjustified. Learned counsel
    further submitted that the alleged closure and retrenchment were
    effected during the pendency of proceedings and in violation of
    subsisting orders passed by competent courts. It is contended that

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    the petitioners failed to comply with such orders or to seek proper
    adjudication before taking such action. In these circumstances, the
    closure and termination are liable to be held illegal and in breach
    of statutory provisions. It is also contended that the petitioners
    have failed to comply with Section 30(2) of the Industrial Disputes
    Act, and that the plea of shifting of the factory cannot be sustained
    in the absence of genuine intention to continue industrial activity.
    It is therefore submitted that the writ petition is devoid of merit
    and deserves to be dismissed. In support of the above submissions,
    reliance is placed on the decisions in Mackinnon Mackenzie and
    Company Ltd. vs. Mackinnon Employees Union
    ,
    MANU/SC/0188/2015, Oswal Agro Furane Ltd. & Ors. vs. Oswal
    Agro Furane Workers Union & Ors.
    , MANU/SC/0104/2005,
    Yashwant Jagannath Ingawale & Ors. vs. Snowcem India Ltd. &
    Ors., MANU/MH/0578/1999
    , and Pt. Mohanlal Sanatan Dharam
    Public School vs. Harjit Singh & Anr., 2026 I CLR 334.

    REASONS AND ANALYSIS:

    10. I have carefully considered the rival submissions and the
    material placed on record. The real dispute between the parties is
    not difficult to understand. The petitioners say that the factory was
    lawfully closed because the business had become uneconomic,
    most of the workmen had already resigned under settlements, the
    remaining strength was below the statutory limit, and therefore
    Chapter V-B of the Industrial Disputes Act, 1947 had no
    application. The respondents, on the other hand, contend that the
    so called closure was only a cover, that the real purpose was to
    hand over the land for development, and that the petitioners acted

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    in breach of the labour laws and in collusion with a union. Both
    sides have placed reliance on documents and on decided cases. But
    the Court has to see whether the findings recorded by the
    Industrial Court can stand on law and on facts.

    11. The first matter which requires close attention is the very
    foundation on which the Industrial Court has proceeded to hold
    that the closure is illegal. The Industrial Court has referred to
    Sections 33, 18, 25-N and 25-O of the Industrial Disputes Act and
    has treated the case as if all these provisions were attracted. This,
    in my view, shows a somewhat mixed approach without first
    examining whether the basic conditions for applying these
    provisions were satisfied. Section 33 is not a general provision. It
    comes into play only when there is a proceeding of the nature
    specified in that section already pending before a competent Court
    or Tribunal. It is not enough to say that some dispute or some
    litigation is pending somewhere. The nature of the proceeding
    must fall within the scope of Section 33. Here, what was pending
    was a complaint under the ULP Act and at one stage a writ
    petition. These cannot automatically be treated as proceedings
    attracting Section 33. The petitioners are right in pointing this out.

    12. There is one more difficulty. The complaint filed by the
    respondents does not clearly plead how Section 33 is said to be
    violated. There are no proper factual statements showing what
    proceeding was pending, before which forum, and how the action
    of closure was in breach of that provision. In law, a finding cannot
    be recorded in vacuum. There must be pleading, then evidence,
    and then reasoning. If the foundation itself is absent, the

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    superstructure cannot stand. The Industrial Court, therefore, was
    not justified in recording a finding of breach of Section 33 in the
    absence of clear pleadings and proof. This part of the reasoning
    cannot be sustained.

    13. Coming to Section 18, which deals with settlements, the
    situation on record is quite clear though the Industrial Court has
    not properly appreciated it. Out of the total employees, as many as
    125 persons accepted the settlement, tendered resignation and
    took the benefits. This covers almost the entire workforce. These
    persons did not challenge the settlement at any stage. On the
    contrary, they filed affidavits before the Industrial Court in the
    earlier complaint and got their names deleted. This shows that
    they acted upon the settlement and accepted it as final. In such a
    background, the present four respondents cannot be permitted to
    question those settlements as if they are speaking on behalf of all
    employees. They were not parties to those settlements. Their
    grievance, if any, is confined to their own termination.

    14. The Industrial Court, however, appears to have gone beyond
    this and examined the validity of the settlements themselves. This
    was not necessary in the present complaint. The scope of
    Complaint (ULP) No. 248 of 2013 was limited. It was concerned
    with the alleged illegality of closure and the termination of the
    present respondents. The settlements with other employees had
    already worked themselves out. Once the employees accepted
    benefits and left service, that chapter had come to an end. It could
    not have been reopened indirectly in these proceedings. By doing
    so, the Industrial Court travelled beyond the scope of the

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    complaint and entered into an area which was not open for
    consideration at the instance of these respondents.

    15. The issue relating to Chapter V-B requires even more careful
    examination. This is because the entire case of illegality of closure
    largely depends upon whether Section 25-O applies. But Section
    25-O
    does not apply to every industrial establishment. It applies
    only if the establishment employs 100 or more workmen on an
    average per working day during the preceding twelve calendar
    months. This is a clear statutory requirement. It cannot be
    assumed. It must be established by evidence. In the present case,
    the petitioners have produced muster rolls and have worked out
    the average number of workmen as 84.85 for the relevant period.
    This is a specific figure based on record. The respondents, on their
    part, have not brought any convincing material to show that the
    number was 100 or more. The burden to prove this fact lies on the
    respondents because they are the ones who assert that Section 25-
    O
    applies. The Industrial Court has not recorded a clear finding on
    this aspect. There is no discussion showing how the figure of 100
    was reached or accepted. In absence of such a finding, the
    conclusion that there is a breach of Section 25-O becomes
    unsustainable. The law requires the Court to first cross the
    threshold of applicability. Only thereafter can it examine
    compliance or breach.

    16. The evidence of Respondent No. 1 further weakens the
    respondents’ case. In cross-examination, he has stated that the
    figures mentioned in his affidavit regarding number of employees
    were based on instructions from his advocate and he could not

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    explain them properly. This is an important admission. It shows
    lack of personal knowledge about a crucial fact. When such is the
    position, the Court cannot rely upon such statements to hold that
    the statutory requirement of 100 workmen was satisfied. The
    Industrial Court has not properly weighed this aspect. The
    argument of the respondents that there were originally 129
    employees also does not carry the matter further. The law under
    Section 25-K does not look at past strength at some earlier point of
    time. It looks at the average number of workmen during the
    immediately preceding twelve months. This distinction is
    important. After the settlements and resignations, the strength of
    the workforce reduced considerably. The petitioners have placed
    material to show this reduction. The respondents have not
    effectively rebutted it. Therefore, merely because at one stage
    there were 129 employees, it cannot be presumed that Chapter V-B
    continued to apply at the time of closure. The Industrial Court, in
    my view, did not undertake this precise examination which the law
    requires.

    17. The finding regarding retrenchment of 129 employees also
    suffers from similar difficulty. The petitioners’ case is consistent
    that 125 employees resigned voluntarily under settlements prior to
    closure. If that is accepted, then those 125 employees cannot be
    treated as retrenched. Retrenchment has a specific meaning in law.
    It does not include voluntary resignation. The respondents have
    alleged that the settlements were manipulated and not genuine.
    But such a serious allegation requires strong and reliable evidence.
    It cannot be accepted on mere suspicion or general statements.

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    The record does not show material of that quality.

    18. It is true that the respondents have raised allegations of
    collusion with a union and have questioned the role of certain
    persons. However, the Court has to act on evidence and not on
    conjecture. When a large number of employees have accepted
    settlement benefits and have themselves sought deletion from
    proceedings, it becomes difficult to hold, without clear proof, that
    all those acts were sham or forced. The Industrial Court appears to
    have treated the entire sequence as if it was one composite act of
    retrenchment affecting all employees. That approach overlooks the
    distinction between voluntary exit and forced termination. On
    facts, the two stand on different footing.

    19. The question of motive has also been discussed by the
    Industrial Court. It has observed that the closure was effected with
    a view to sell the factory land. The respondents have relied upon
    later developments such as change of user of land and construction
    of residential buildings. These circumstances may raise doubt in
    the mind. But the Court has to be careful. The legality of closure
    must be judged on the basis of the situation existing at the time of
    closure. Subsequent events may provide background, but they
    cannot by themselves prove that the closure was illegal when it
    was effected. If the business had become financially weak, if most
    employees had already left, and if the statutory provisions
    requiring prior permission were not applicable, then the closure
    cannot be held illegal only because later the land was put to a
    different use. The Industrial Court, in my view, has placed
    excessive reliance on subsequent development of the property and

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    has not sufficiently examined whether the legal conditions for
    closure were satisfied at the relevant time. Suspicion cannot take
    the place of proof.

    20. The respondents have also argued that the petitioners acted
    during pendency of proceedings and in disregard of earlier orders.
    This submission also needs to be seen carefully. Pendency of
    proceedings does not mean that every action of the employer
    becomes prohibited. What has to be seen is whether there was a
    specific legal bar and whether that bar was violated. If the
    provisions like Section 33 or Section 25-O are not attracted, then
    the mere existence of proceedings elsewhere does not make the
    closure illegal. The Industrial Court has not clearly analysed this
    aspect. It has proceeded more on a general sense of impropriety
    rather than on strict statutory requirements.

    21. The reference to Section 30(2) also does not advance the
    respondents’ case in absence of necessary factual basis. The Court
    must first establish the facts which bring the case within that
    provision. Without that, the conclusion cannot follow. The
    reasoning of the Industrial Court does not show such a structured
    approach.

    22. Finally, the relief granted also requires scrutiny. The
    Industrial Court has directed payment of 50 percent wages till the
    date of superannuation. Such a direction is based on the
    assumption that the closure was illegal and that the workmen were
    wrongfully deprived of employment. If the basic finding of
    illegality is not sustainable, the relief automatically loses its

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    foundation. Moreover, it is stated that the factory itself is no longer
    in existence. In such a situation, granting continuing wages till
    superannuation becomes difficult to justify in law. The remedy
    must be proportionate and based on correct legal findings. Here,
    the relief appears to have been granted without a firm legal basis.
    For all these reasons, the reasoning adopted by the Industrial
    Court does not stand to proper legal scrutiny. The findings on
    breach of statutory provisions, on retrenchment, and on motive are
    not supported by adequate pleading, proof and correct application
    of law. The conclusions, therefore, cannot be sustained.

    23. In view of the foregoing discussion and reasons recorded
    hereinabove, the following order is passed:

             (i)      The Writ Petition is allowed;
    
             (ii)     The Judgment and Order dated 20 July 2016 passed by
    

    the Industrial Court, Mumbai in Complaint (ULP) No. 248 of
    2013 is quashed and set aside;

    (iii) Complaint (ULP) No. 248 of 2013 filed by the
    respondents stands dismissed;

    (iv) Rule is made absolute in the above terms;

             (v)      There shall be no order as to costs.
    
    
                                                           (AMIT BORKAR, J.)
    
    
    
    
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